Health Law Alert

2012: Issue 19 - Focus on White Collar

An Ounce of Prevention Is Worth a Pound of Cure Why You Need an Effective Compliance Program

By: Gina L. Simms and Amy E. Garber*

For centuries, health care providers have enlightened patients with the well-known adage: “an ounce of prevention is worth a pound of cure.” A recent set of cases involving a durable medical equipment company and its employees illustrate that health care providers can benefit from the same wisdom. The cases involving Orthofix, Inc. and its employees serve as cautionary tales that emphasize the need for an effective compliance program. Having an effective compliance program can be that “ounce of prevention” that can aid a company in warding off costly federal civil and criminal prosecutions and the potential damage to an entity’s reputation and financial well-being that may result from those prosecutions.

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Government Fails to Prove Alleged Kickback Scheme Violates False Claims Act

By: James P. Holloway

When the U.S Justice Department alleges a violation of the False Claims Act (FCA), some health care providers conclude that they must reach a settlement with the government because they cannot win — or cannot afford to win — in court. In some cases, a settlement is indeed the prudent course to control liability, minimize adverse publicity, and/or reduce litigation costs. However, the Justice Department’s recent loss at the trial of an FCA case demonstrates that when the government is forced to back up its allegations with proof, providers may be successful in defending against FCA allegations.

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